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LEARNING REVIEW
12-6. How does a movie theater use off-peak pricing?
12-7. Matching demand with capacity is the focus of __________ management.
12-8. What factors will influence future changes in services?
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APPLYING MARKETING KNOWLEDGE
1. Explain how the four I’s of services would apply to a Marriot Hotel.
Answers: The four I’s are intangibility, inconsistency, inseparability, and inventory.
With regard to a Marriott Hotel:
2. Idle production capacity may be related to inventory or capacity management.
How would the pricing component of the marketing mix reduce idle production
capacity for (a) a car wash, (b) a stage theater group, and (c) a university?
Answers:
3. Look back at the service continuum in Figure 12-3. Explain how the following points
in the continuum differ in terms of consistency: (a) salt, (b) automobile, (c) advertising
agency, and (d) teaching?
Answers:
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4. What are the search, experience, and credence properties of an airline for (a) the
business traveler and (b) pleasure traveler? What properties are most important to
each group?
Answers: Business travelers and pleasure travelers may evaluate different service
characteristics. For example:
5. Outline the customer contact audit for the typical deposit you make at your
neighborhood bank.
Answer:
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6. How does off-peak pricing influence demand for services?
7. Draw the channel of distribution for the following services: (a) a restaurant,
(b) a hospital, and (c) a hotel.
Answers:
8. The text suggests that internal marketing is necessary before a successful marketing
program can be directed at consumers. Why is this particularly true for service
organizations?
9. Outline the capacity management strategies that an airline must consider.
Answer: An airline must consider strategies for the following groups:
10. In recent years many, service businesses have begun to provide their employees with
uniforms. Explain the rationale behind this strategy in terms of the concepts
discussed in this chapter.
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BUILDING YOUR MARKETING PLAN
In this section of your marketing plan, you should distinguish between your core
product—a good or service—and supplementary services.
1. Develop an internal marketing program that will ensure that employees are prepared
to deliver the core and supplementary services.
2. Using the flowchart in Figure 12-7 as a guide, create a customer contact audit to
identify specific points of interaction with customers.
3. Describe marketing activities that will (a) address each of the four I’s as they relate to
your service and (b) encourage the development of relationships with your customers.
Add this section as an appendix to your marketing plan and use the results to
develop your marketing mix strategy.
Helping with Common Student Problems
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TEACHING NOTE FOR VIDEO CASE VC-12
LA Galaxy: Where Sports Marketing Is a Kick!
Synopsis
This case describes the sophisticated marketing program at the LA Galaxy soccer club,
one of 19 clubs in Major League Soccer (MLS). The LA Galaxy has been the most successful
franchise in the league, winning the MLS Championship four times. President Chris Klein and
his team of marketing managers use their skills to create “a unique product for people.”
The case provides students with an opportunity to understand how marketing concepts
can be applied to services, specifically a professional soccer club. Like all services, soccer is an
experience that is constantly changing because the players, the opponents, the weather, and the
outcome of each game are always different. Each element of the marketing mix and the specific
marketing activities used to create the Galaxy experience are described. Students also learn
about important elements of the soccer business such as broadcast rights, sponsorships, and
merchandise sales.
Teaching Suggestions
Introduce the class to the unique aspects of services by discussing services they use. The
list might include airlines, hairstylists, hotels, automobile repair centers, and movie theaters. Ask
how the 4 I’s of services—intangibility, inconsistency, inseparability, and inventory—are
evident in their examples. Some students will also mention that professional sports are a service.
Use that example to ask:
1. How many of you played soccer as a child or high school student?
2. How many of you went to or watched a major league soccer game last season? Why or
why not?
3. What could a major league soccer team do to make it more likely that you would attend
games?
These questions then lead to the questions posed in the case.
Answers to Questions
1. What is the LA Galaxy “product?”
Answer:
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2. Which of the seven elements of the services marketing mix are most important in the
LA Galaxy marketing program?
Answer:
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3. (a) How is promotion (advertising, personal selling, public relations, sales promotion,
and direct marketing) used by LA Galaxy? (b) Do these activities depend on specific
target markets being reached?
Answers:
4. How are social media integrated into the LA Galaxy’s marketing strategy?
Answer:
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5. How does the LA Galaxy assess the impact of its marketing activities? Has its
program been successful?
Answers:
Epilogue
The LA Galaxy marketing team continues to add new and exciting marketing elements to
its program. The club recently announced an innovative collaboration between the LA Galaxy
and Herbalife to develop an original web series called Be A Pro. The documentary style series
features eight episodes that explore what it takes to be a professional soccer player in terms of
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TEACHING NOTE FOR APPENDIX D CASE D-12
Philadelphia Phillies, Inc.: Sports Marketing 101
Synopsis
The Philadelphia Phillies is a major league baseball team located in a large
metropolitan area. This location means it must compete for fan (consumer) attention and
dollars with not only other professional sports (the Philadelphia Eagles in football, the
Philadelphia 76ers in basketball, etc.) and local college sports (University of Pennsylvania,
Villanova, etc.) but also other summer recreational activities—like visits to the New Jersey
shore, the Poconos mountains, golf club memberships, etc. and with the options of watching
the Phillies and other sporting events on TV.
The case makes the important point that Phillies management cannot promise a winning
baseball team because there will be both good years and bad years. This is why president and
chief executive officer (CEO) David Montgomery wants Phillies fans at a game to be at a
“happening”—to be close to the field in its new stadium, to be surrounded by other excited
fans, and to have a fun day or night at the ballgame. This involves offering everything from
special nights targeted at special segments of fans to laughing at the antics of the Phillies
Phanatic—probably the most successful mascot in all of U.S. professional sports.
Teaching Suggestions
Introduce the class to the kinds of marketing issues David Montgomery and the Phillies
face by asking these questions to set the stage for the class discussion of the case:
1. How many of you are major league baseball fans?
2. How many of you went to a major league baseball game last season? Why or why not?
3. What could a major league baseball team do to make it more likely that you would attend
games?
Answers to Questions
1. (a) What is the “product” that the Phillies market? (b) What “products” are the
Phillies careful not to market?
Answers:
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2. How does the “quality” dimension in marketing the Philadelphia Phillies as an
entertainment service differ from that in marketing a consumer product such as a
breakfast cereal?
Answer:
3. In terms of a social network marketing strategy, (a) what are the likely characteristics
of the Phillies fans and (b) what should the Phillies Facebook fan page contain?
Answers: